Flexo at ConsumerismCommentary recently did a student loan consolidation. By setting up automatic payments, the rate goes down to 4% -- not bad considering rates have risen in recent years. However, with a 20 year repayment schedule Flexo's loan would cost about $10,000 in interest. Is it worth it? See Flexo's situation and read some interesting discussion in the comments below. You have to consider the other things you could do with the money, and any tax benefits you get from student loans. Everybody will have a different "right" answer.
Further reading:
- Student loan interest deduction
- Earn more than 4% APY in internet bank accounts
Great tip! Thanks!